Insurance has been described as many things but surely never liquid gel – MMPI will explain why it believes the analogy is apt. Insurance is the cornerstone of sound financial planning. It helps dilute the effects of shocks and untimely events. But frequently it is ignored or side-tracked even by financial planning professionals, who really should know better.
Far too often, consumers divide up their financial affairs into separate boxes; day-to-day finances here; emergency funds there; compulsory insurances over there; discretionary insurances way down the back somewhere and retirement pensions up in the air like a juggling act. While this system might suit a certain type of brain it fails to recognise the inter-connectedness of personal finance. These are the finances of one person or one family and the lives of these people do not conform to simplistic segmentation. Life is full of risks. Some risks are preventable and easily managed but some are completely unexpected.
Having one’s financial thoughts divided up into haphazard pigeon-holes does not allow for a seamless resolution when things start to go awry. Although insurance can be confusing and the jargon turgid, its importance as a link that gels finances together should not go unrecognised.
MMPI maintains that insurance is a liquid gel. Ideally, it should be allowed to seep into every aspect of our lives calmly and effortlessly easing the financial burden when shocks arrive. It is insurance that binds financial planning together and, therefore, allows us to make sense of our future needs.
It is a fact of life in our modern, busy world that consumers do not have time to truly consider all of their financial options. Accordingly, they take short cuts. They prioritise compulsory insurances like motor and death and leave the other nebulous stuff till later. Unfortunately, many consumers never get around to considering other important insurances – meaning that they are unable to deal with emergencies.
Due to medical advances the average consumer is today much more likely to be diagnosed with a serious, debilitating illness and to survive for many years afterwards. This can be traumatic not only for the patient but also for the immediate family and wider business interests.
In such instances, serious illness insurance or business partnership protection would provide ample financial cover and provide the gel that seals the finances and future plans back together again. Financial plans that do not incorporate comprehensive insurance cover are placing a huge dependency on nothing going wrong. This is unwise.
Think of insurance as a jelly-like product that can have properties ranging from simple and complex to dependable and reassuring. Think of it as being flexible enough to meet your unique needs; and to be capable of offering protection for a very long time. But be careful not all gels are the same! Some offer medical protection and vanity enhancements of varying degrees; while others are good at shaping your hair. Don’t ignore the usefulness of a good insurance product but be careful what you ask for.
